Federal Reserve

Demystifying Monetary Policy Surprises: Fed Response to Financial Conditions and Wait-and-See for New Economic Data

This paper explains why monetary policy surprises are predictable: the Fed responds to financial conditions while taking a wait-and-see approach to economic data.

Monetary Transmission in Money Markets: The Not-So-Elusive Missing Piece of the Puzzle

Adding variables to a VAR model may not solve the price puzzle but changing the policy indicator does.

Zhengyang Chen, Victor J. Valcarcel